The crypto market finally succumbed to pressure as investors contemplated the Federal Reserve’s decision to leave interest rates unchanged for September while looking forward to a tighter monetary grip over the coming months. Bitcoin price slid below $27,000 support following a rejection from $27,200.
Attempts to regain control over the $27,000 went down the drain with losses currently stretching to $26,600. Down 0.5% in the last 24 hours, Bitcoin price is trading at $26,606. News that fallen exchange Mt. Gox would delay payouts helped to control the coin’s downside amid speculations of another sweep at the $25,000 major support.
According to the on-chain analytics platform IntoTheBlock (ITB), the correlation between Bitcoin price and the US Dollar Index has hit a new milestone – zero, which may imply that the strongest currency in the world has no impact on BTC.
Furthermore, “there is currently almost no correlation with any of the major indices,” ITB said via X. As Bitcoin tries to shape the trend toward the halving in 2024, the question is, is this lack of correlation a bullish or bearish signal?
Mixed sentiments among investors question whether BTC has bottomed or will it need to retrace further before aligning the uptrend for the next bull market tied to the miner reward halving in April 2024.
Based on the short-term outlook, further declines are likely before the next significant jump to the prominent hurdle at $31,000. The seller congestion at $27,000 suggests that although the market structure improved in September, the uptrend lacked the momentum to be sustainable.
The 200-day Exponential Moving Average (EMA) (purple) stands in the way of gains hoping to make it above $27,000. If this downward pressure on Bitcoin continues, the immediate support by the 100-day EMA (blue) might budge and let BTC freefall to $26,000, or to $25,000 if push comes to shove.
The Moving Average Convergence Divergence (MACD) reveals that a sell-off from the current price level is the most likely outcome. More traders could soon be willing to short Bitcoin, especially with the blue MACD line staying below the red signal line.
The Relative Strength Index (RSI) in the same short time frame, upholds the bearish outlook. Watching BTC’s reaction to key levels at $27,000, the 200-day EMA, the 100-day EMA, and the support area at $26,000 and $27,000 would be instrumental in foretelling where Bitcoin is headed.
Crypto trader and analyst, @rektcapital suggested via X that based on the 2018 bear market bottom, Bitcoin price is yet to bottom. He opined that before the previous bull run in 2021, Bitcoin revisited a macro higher low in March 2020.
If history is to repeat itself, “the 2022 Bear Market Bottom has also very similarly formed a Macro Higher Low that could be revisited in the future.”
The current Bitcoin price doldrums might force Bitcoin price to shutter support at $25,000 for another sweep at $20,000 before the trend into the 2024/2025 bull market starts to build.
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